Social media conv. wisdom is to start out really open, but that assumes new space. #buzz is an add to old space. Rules change. #google

And a friend of mine commented on Facebook (I’ve setup my Twitter feed to update my Facebook status):

Doesn’t it seem like Google is copying facebook’s status updates? I don’t see what the big deal is.

I was trying to make a more salient point, which is that Gmail and Facebook are vastly different social spaces. Facebook is the “new space” where the purpose is originally and has always been for social networking. Gmail is traditionally the space for email, which for some people overlaps with “social networking” but for many others do not. As such, Google, by introducing functionality that is more effective when open into a system that is traditionally more closed, is bound to cause conflicts, and users (not the technorati, but normal people) will get confused. In order to address this, they have to abide by the rules of the old territory so to speak, which is to start closed and then open up, which curtails adoption momentum. However, this is offset by broader reach to an already installed base. On the other hand, Facebook started out being a really open space and then only progressively introduced privacy controls. Google by introducing similar functionality into Gmail does not have the luxury of progressively adding privacy controls, but has to have it from day one in order not to confuse and alarm normal users. In a way it’s ironic that Google in this case seems not to be the disruptive innovator but instead the incumbent (reference “The Innovator’s Dilemma” Clayton M. Christensen).

Present in full force was the power-packed Status.Net team which included the former CTO of the Wikimedia Foundation, Brian Vibber, and seasoned entrepreneur/open source business pioneer CEO Evan Prodromou. This is a team that understands the DNA of the Internet and its open source roots, and how its future that includes microblogging will eventually be moulded in accordance to its genetic makeup. An illustration in point: the instinctive openness exhibited at StatusCamp towards supporting open protocols such as ActivityStreams, PubSubHubBub, and Salmon within Status.Net highlights the value of being part of on-the-surface seemingly chaotic open source ecosystems, and how we can all be stronger when disparate but open parts can be combined to work together than when we work in silos.

Yes, the Internet has grown up and is a platform upon which commercial activities thrive. In this respect, Status.Net’s WordPress.com/wordpress.org analogy summarizes their business model very well, has been validated with the success of WordPress, and is easy to understand to even people not familiar with open source. I am very much looking forward to the upcoming public beta of the Status.Net hosted service.

At Citadel Rock, we will be actively incorporating Status.Net into our Online Collaboration and Social Media offerings. Customers will have the option of using the Status.Net hosted service (we will normally recommend this) or on their own premises (software maintenance subscriptions can be purchased from Status.Net). Citadel Rock will provide customization and integration services. In 2010, We will be proactively working on integrating the open source TikiWiki platform with Status.Net, similar to what we are doing right now with Big Blue Button, an open source web conferencing system.

Crossposted: http://citadelrock.com/www/blogpost5-The-First-StatusCamp-in-Montreal

1. There is a nation-wide effort under the umbrella of Canada 3.0 and Canadian Digital Media Network that all stakeholders in the Canadian Digital Media landscape should participate in. The goal of this initiative is to have a unified strategy to secure Canada’s future as a world leader in digital media.
2. Digital media (the creation, distribution, and consumption of it) is a key infrastructure input to all sectors of Canada’s economy. It is vitally crucial and impacts all industries, and a desire for a unified strategy requires broad reaching economy-wide coverage. Challenging perhaps, but necessary, and I believe that with sufficient open collaboration, it will succeed.

Notes on individual discussions can be found at the Digital Media Camp Toronto Wiki, but do give some time for handwritten notes that have been written on flipcharts to make its way up into the wiki.

Now that I have had a closer look at the Canadian Digital Media Network website, I do have some suggestions:

1. The definition of Digital Media as prominently displayed on the current website is too “weak”. Perhaps better is a statement of what is already happening and will be pervasive in future, something like, “Today, information and media is increasing being created and shared virtually, rather than physically. This trend will not only continue but it is expected that by xxxx, xx% of new content will be distributed and consumed in digital form. Even for media that is non-digital in final form, e.g. a book, much of the production process already uses digital media. Digital media is pervasive and is critical infrastructure now and for the future, whether it is in broadcasting, communications, education, entertainment, finance and insurance, healthcare, internet, manufacturing, natural resources, publishing or any sector of the economy.”
2. We need new material (videos, etc…) that covers digital media innovations and activities from the whole of Canada. A united face for digital media in Canada would be highly beneficial and I hope that the Canadian Digital Media Network can fulfill that role.  It’ll probably take some time for other regional participants to contribute new content but I hope it will happen soon. My hunch is that an appeal for content in the spirit of collaboration will gather momentum especially as more Digital Media Camps happen in other cities and the 2010 Canada 3.0 conference approaches.

On a separate note, I sense an urgent need for the open source and open content industry to highlight the importance and benefit of Creative Commons and Open Source innovations within the Canada 3.0 and Canadian Digital Media Network fora.

If not, Canada risks losing competitive advantages from being one of the more Open Source and Creative Commons friendly business environments in the world. I would point out that being a smaller country (in population) and therefore lacking the benefit of pure numbers, Creative Commons can be an extremely cost-effective and viral way for for Canadian culture in the form of Digital Media to spread,  just as Open Source can do for Digital Media technology.

Nonetheless, I am happy to hear from individuals at the Digital Media Camp that there is not insignificant grassroots level use of Open Source Tools for Digital Media, as well as interest in Open Content initiatives. I also know that Canadian thought leaders like Michael Geist who have strong understanding on the benefits of Open Source and Creative Commons are advisors to policy makers.

Projects like Open Source Cinema, which is a Canadian born project (BC), must be part of the picture. In Toronto, we have leaders, e.g. at Seneca, who are the founding hosts of the international Teaching Open Source Summit this year. Don Tapscott, thought leader and author of “Grown up Digital” and “Wikinomics” is adjunct professor at the Joseph L. Rotman School of Management,  University of Toronto. The Open Source Business Resource is an initiative of Carleton University in Ottawa.

With world leading institutions like Harvard Business School now teaching Open Source, and NYU/Yale being involved in initiatives like the Open Video Alliance, Canada cannot afford to be left behind in these areas. As a closing note, check out this video which is a case study illustrating how Creative Commons help filmmakers in the digital age: Media That Matters – Creative Commons Case Study

I list below some common arguments against venture capital mixing with open source and the counter-arguments to each of them. You as the reader can make up your own mind.

As for myself, I remain very neutral to the issue – meaning that I believe that at the present moment there is only a minority of venture capital firms that can work effectively with open source companies, and I hope this will change in the future in a way that benefits both open source and venture capital. Now that I’ve stated my position, the arguments…

Argument 1

Venture capital is obsessed with the possibility of exit, which may not be good for open source after all, especially if the exit is a sale to a proprietary software company (like what happened to MySQL inadvertently through Sun?). And frankly, it’s not necessarily good for innovation (which I believe is the real goal of venture capital, not profits ).  See Fork Well: It Could Be The Last, Best Hope for Community for a “free software centric” but very understandable reaction early on in the Oracle-Sun merger news cycle.

Counter-argument 1

There are many possible good investment exits for open source companies that are good for open source in general, such as a merger with or an acquisition by a larger and more influential open source player (e.g. Red Hat), or an IPO. If companies like Novell who are increasing their open source portfolio become more oriented to open source and successful at the same time, it can also be beneficial. And in the Oracle case, there are others that have argued that they have supported many other open source projects after acquisition, such as JBoss and BerkeleyDB (but admittedly it is difficult to analyze what would have been if these stayed independent or were acquired by other organizations instead).

Argument 2

The whole venture capital industry is based on valuations through traditional corporate measures, which is ill-equipped to value open source communities. In fact, it can be argued that the open source communities transcend corporate boundaries and therefore company-based investment simply is somewhat antithetical to the structure. It’s like fitting a square peg into a round hole.

Counter-argument 2

The venture capital industry is in a state of turmoil (CNET News: Big changes needed in the venture capital market), and coping with the nature of open source is part of the transformation that it needs to have in order to reinvent itself. Part of that is finding new models for valuation, adjusting to different investment timeframes, and part of that might involve some drastic changes (which are coming).

Argument 3

The perceived legal risk around commercializing on top of open source licensed technology scares many venture capitalists.

Counter-argument 3

Venture capitalists and their lawyers are gradually understanding that not all open source licenses are the same, and that the legal text together with an understanding of the community reflects a clear enough line (and therefore measurable risk) that is drawn between what should be “community property” and what falls within the prerogative of the companies operating in the community. With more information, entrepreneurs that are cognizant of these constraints (which are in fact strengths if the business plan is sound) should be able to convince potential investors that risks are mitigated.

Argument 4

Venture capital investment could crowd out and discourage community involvement. There could be many reasons for this but in general it might have the potential of disrupting the well-functioning status quo within an existing community which may reduce the contribution of other members who feel that they benefit less from the investment that the company directly being invested in. There may also be a perception of conflict of interest affecting the judgement of community leaders who are founders, employees or significant shareholders of the company receiving venture capital.

Counter-argument 4

Founders, employees or significant shareholders of the company receiving venture capital can “walk-the-talk” and give back generously to the community. In fact, they must, if their business is to be successful. Venture capital has been shown in many cases to have resulted in successful open source companies that are good for open source. After all, venture capital was invested in Red Hat, Zimbra, Xensource, and many others.

On the other hand, many venture capital companies have traditionally prided themselves of being actively involved in adding value (not just financing) to the companies that they invest in. How many venture capital companies invested in open source companies can say the same in terms of their role in helping the community? But I suspect that this again is more of a “lack of understanding” problem and not necessarily the fundamental conflict of interest that many perceive. Things might be better as more and more successful open source entrepreneurs/investors gain experience. Some organizations that clearly benefit a lot from open source clearly have more role to play, say (possibly controversial), e.g. Google Ventures?

For more information:

1. Remarks by Matt Asay, one of the influential people in open source today in an interview about how open source and commercialization mix: http://www.infoworld.com/d/developer-world/open-source-roundtable-matt-asay-176?r=54
2. Open-source VC investments: Time for payback (post on The Open Road blog at CNET) http://news.cnet.com/8301-13505_3-10217824-16.html
3. Report of venture capital investment in open source related firms from 1997 to 2008: http://blogs.the451group.com/opensource/2009/04/08/the-past-present-and-future-of-vc-investment-in-open-source/

And as a postword, perhaps one day open source may not need venture capital as we know it today, but then maybe venture capital may not be what it is today tomorrow anyway, at least for open source.

Open video is not just about codecs and the underlying technological infrastructure, but also the content. But beyond “the medium is the message” often quoted from McLuhan, we are beginning to see that “the means is the messenger”. The future of video promises to be one intertwined with participatory culture, where we hope that the prevalence of open media makes a real difference.

http://dev.tikiwiki.org/GSOC+Ideas+2009

For more information about Google Summer of Code:

http://socghop.appspot.com/document/show/program/google/gsoc2009/faqs

The wide open nature of open source communities does pose certain challenges:

1. The more porous borders compared to traditional industry consortiums mean that it is not possible to predict with a high degree of certainty the future composition of the community. Open source skeptics may argue that might make businesses that depend on open source innovations more vulnerable to hostile interventions or unexpected developments. On the other hand, open systems are by nature self-correcting and may in fact provide more effective layers of defence and more gradual transition.

2. Rampant free-riding exists compared to other environments. Classical economics identifies free-riding as a potential problem, since it implies that innovators are unable to reap full reward for their innovations. However, relatively high levels of free-riding are typically accepted as a natural part of healthy open source communities. The optimally efficient level of free-riding could be higher in certain situations, perhaps due to network effects that accrue benefits offsetting the cost imposed by the presence of free-riders.

Citadel Rock’s top two lessons learned from its experience has been that:

1. The community is more important than your company: Often counter-intuitive for most corporations, the embracing of openness requires significant humility. Open source proponents often refer to a well-understood cultural construct termed “karma” (a measure of gained respect based on one’s past contributions) that accurately describes the apparent cause-effect relationship between giving to the community and the ability to gain more from it.

2. Spending on community outreach is essential: Most conflicts are in fact caused by misconceptions, a lack of communication or familiarity, and not actual or real concerns. Being in close contact with key community stakeholders not only helps to increase mutual understanding but leads to greater opportunities for cooperation. Almost any problem is surmountable if people are motivated to work together to solve them. On the other hand, even the most trivial problems become serious conflicts if people do not get along.

This further reinforces my belief that open source collaboration solutions are inherently superior to non-open source alternatives because open source allows for the widespread proliferation of different vertical solutions based on the same platform, by different members of an extended community. Open source provides the framework within which each vertical solution provider can maximize their chances of success by being extremely focused, at the same time benefiting from economies of scale and scope by being part of a larger community.

In open source environments, value is primarily created (and monetized) by “maintainers” of the code who keep each vertical solution up-to-date and relevant to the needs of targeted users, since the “stock value” of the code has been communalized. The cost of maintaining the code is shared, enabling each vertical solution provider to incur far less cost than if they were to develop the solution using a proprietary model. At the same time, their competitive differentiators are not undermined, since code does not stand still – it requires constant maintenance and “flow values” generated by the “maintainers” is what customers will pay for.

As there are countless vertical solutions possible with a platform as comprehensive as TikiWiki, this presents a remarkable opportunity for entrepreneurs and consultants to take on responsibility for maintaining new vertical solutions for markets that they have relationships in, and to monetize it in the way most suitable for each market.

We hope more and more open source entrepreneurs and consultants will join in. There are significant developments at the core of the TikiWiki community to facilitate this, for example, the upcoming Installation Profiles system and TikiWiki “Magic” (codename for the new data driven admin panel) will make it much easier to configure and maintain different vertical solutions.